Brandy, I so agree with your statements. The part of Daves programs that bug me is the ease which he throws out "get a third job" and "deliver pizzas!". He assumes everyone got in debt like he did...living large and making dumb investment decisions.

Just like everyone assumes that people who got foreclosed on got that way because they bought too much house than they could afford. hello there are those of us that bought within our means and then our means changed.

Cinnamonhuskies:

The part of Daves programs that bug me is the ease which he throws out "get a third job" and "deliver pizzas!"

Now I understand the pizza delivery vehicles I have been seeing lately. I have been seeing $30,000 pick-up trucks, SUVs and sports cars delivering pizza in our neighborhood. They must be listening to Dave, lol. I still don't know how they are affording the fuel though.

Brandy:

I have been seeing $30,000 pick-up trucks, SUVs and sports cars delivering pizza in our neighborhood.

Brandy:

Cinnamonhuskies:

The part of Daves programs that bug me is the ease which he throws out "get a third job" and "deliver pizzas!"

 DH had a problem with that too.  It's not that he doesn't want 1,000 in an emergency fund.This summer we spent 800 in car repairs so it could pass inspection.  DH told me "Well, there goes the 1,000 fund".  What he meant was, we didn';t have it tucked away but when he had to come up with the $$$ he did.  Now we are back to 0 and the way things are going I'd be lucky if I can save $100 by December.  It can be discouraging but right now I can't work without leaving my children alone.  If I went back to work, maybe on the weekends our family would suffer in other ways (just to bring a few $$$ in).  So we do the best with what we have and if we don't have the $$$ we do without or find a way to do it.

This year my youngest goes to preschool but I don't pay a penny. I got together with other moms and we take turns teaching.  All my other kids went to a paid preschool.  Right now there isn't enough money for gas or preschool (and many other things).  This is just an example of trying to do the same things but differently.  I hope that one day  I can live like Dave R preaches but I have to be patient for that.

Brandy:

Cinnamonhuskies:

The part of Daves programs that bug me is the ease which he throws out "get a third job" and "deliver pizzas!"

Now I understand the pizza delivery vehicles I have been seeing lately. I have been seeing $30,000 pick-up trucks, SUVs and sports cars delivering pizza in our neighborhood. They must be listening to Dave, lol. I still don't know how they are affording the fuel though.

 

 

That must be it! Dave really says in the audios and dvds to go deliver pizzas when youre not at your day job. Kind of like stepping over a dollar to pick up a penny? All the minimum wage extra jobs aren't going to help if youre not cutting out the big ticket things too. It goes hand-in-hand.

Brandy:

Now I understand the pizza delivery vehicles I have been seeing lately. I have been seeing $30,000 pick-up trucks, SUVs and sports cars delivering pizza in our neighborhood. They must be listening to Dave, lol. I still don't know how they are affording the fuel though.

 

 

Yeah, I've seen pizza delivery people with much nicer cars than what I drive and I wonder how they can do it.  I guess they might be following Dave Ramsey.

Carmina:

I hope that one day  I can live like Dave R preaches but I have to be patient for that.

Sometimes the debt freedom journeys have to include extreme frugality. Sadly for a growing number this means going without or making do on even what is termed as necessities and common things by today's standards.

Walt34:

slk2042:

Does Dave Ramsey say that a mortgage is an acceptable debt or not? I can't remember. Either way, we've gotta pay to live somewhere, either rent or a mortgage. May as well use that monthly payment to get equity, IMHO.

I know there are some financial advisors that say we should save up to pay cash for a house. I just don't see that being a practical goal. My family would never get there!

 

It depends on how lucky do you feel. Will the dollar value of the house go up or down during the period you own it? What is the difference in cost for ownership vs. renting, and what would you do with the difference? A strong financial argument can be made for never owning a house if one considers the interest payments over a 30-year loan, and understanding that principal+interest+taxes+insurance is generally only 60% of the cost of owning a home. The rest is for maintenance and improvements.

But there is also the value of the satisfaction of owning your own home and knowing you can do whatever you want with it, not the case with a rental. You have to place your own dollar value on that. You also have to place your own value on knowing that the price will stay the same (assuming a fixed-rate mortgage) vs. having the landlord raising the rent. But if the furnace dies or the basement leaks that's your problem, not someone else's.

There are a large number of people who choose not to own homes for those and other reasons and prefer apartment living so they don't have to deal with those maintenance issues. Or if they move frequently the buying/selling costs outweigh any possible gains in house appreciation now that the boom years are clearly over.

So, as with many other things in life, you "pays your money and takes your chances". There is no clear cut answer for everyone.

One of Dave Ramsey's steps to financial freedom is mortgage retirement, but it is far from the first step and not expected to happen quickly. It was our last step to financial freedom, and we have slept better since retiring the mortgage.

We prefer owning our own plot and house, but that's not everyone's goal. As long as we can pay the property taxes, it's ours. No one can evict us.

Perhaps what Ramsay means is that when you pay off your credit cards, you can take the money you WERE spending on them and apply that to your $1,000 goal.

I pay about $700 a month in credit cards. I suspect that, were I to make a heck of an effort, I could save $800 a month once I pay off the cards. Possibly $1,000, if I really, really, made the effort.

But maybe he picks $1,000 because it's four digits, and for a lot of us, three digits just doesn't have the same impact as saving four digits. $1,000 a month is $12,000. But $230 a week is just a couple dollars less. Somehow saying you save $1,000 a month seems more impressive though. $230 is more like "Well, that's good, but writing out a single check once a month for $1,000 is somehow cooler."

We are in the middle of the Financial Peace University class.  So I can answer a couple of things. 

1.  The guys delivering pizzas in their big cars ARE NOT following Dave.  He would tell them to sell that big car and buy one they can afford. 

2.  Alex, Dave says get that $1000 in a little emergency fund BEFORE you start paying off the cards.  Pay minimums on all the cards for as long as that takes.  Then as you start paying them off, if things come up (like my steel belt on a tire separated), I can pay for that without using a card and adding to my debt.  He calls it Murphy repellant.  When you have that money in the bank, less "emergencies" actually come up!

I have always done some kind of budgeting - - we have been paid once a month most of our married lives, and you don't have to run out of food before you run out of month many times to learn not to do that!  I like Dave's methods and I liked Larry Burkett's (which is where he got that part from).  I agree that he is a little focused on true middle class folks.  We HAVE the money, we just aren't managing it well enough.  I do LOTS of frugal things, but I think there is always room for improvement.  I think it's all a part of being a good steward and smart with my money.  My husband is disabled and I am the breadwinner.  I have to use all the tricks I can.

 One thing I am waiting for in this course is to hear about his investing advice.  I read TMMO and it seemed to be written BEFORE the latest crash and financial market changes.  It still talked about making 12-18% on your investments.  I don't know if that is reasonable to expect at this point. 

Of course, I am also looking forward to getting my debt paid off.  I can't wait to have all that $$ freed up in my budget!